Feb 24, 2007 4 min read

By Tom Krisher Associated Press writer

DETROIT (AP) – Whatever was normal inside Chrysler’s Auburn Hills headquarters is normal no more as top executives simultaneously try to manage a major restructuring plan while selling cars and possibly their company.

A senior Chrysler official said Friday that the company is giving detailed financial information to selected potential suitors and is working with its investment bank, JPMorgan Chase & Co., to avoid divulging sensitive information.

The Chrysler official, who asked not to be named because the information is confidential, said the company is assembling a list of potential qualified suitors that the official would not identify.

“It’s not an auction,” said the official. “There will be some firms that will be allowed in to look at it and there will be a prospectus that will be presented to them.”

Among those that analysts say are exploring a purchase of the struggling company are four private equity firms, plus General Motors Corp.

The equity firms, Apollo Management LP, the Blackstone Group, the Carlyle Group and Cerberus Capital Management LP, all refused comment on Friday. GM also has not commented, although it will not deny reports that it’s interested.

Chrysler Chief Executive Tom LaSorda spent the week trying to soothe fears about what would happen to the company, sending out an e-mail to employees asking them to focus on making and selling great cars. He told dealers on a telephone conference call Thursday that the board of Chrysler’s German parent, DaimlerChrysler AG, has endorsed the restructuring plan as the path toward a return to profitability by 2008.

Meanwhile, Volkswagen AG spokeswoman Christine Ritz said Europe’s biggest automaker was not interested in acquiring money-losing Chrysler if it is put up for sale. The Renault-Nissan auto alliance and Hyundai Motor Co. said earlier they were not interested in buying Chrysler.

DaimlerChrysler’s U.S. shares were up 93 cents, or 1.33 percent, to $70.91 in late afternoon trading on the New York Stock Exchange.

Chrysler last week announced it lost $1.475 billion in 2006 and said it expects losses to continue through 2007. DaimlerChrysler AG, however, earned $4.26 billion in 2006.

The news was accompanied by plans to shed 13,000 jobs, including 11,000 production workers and 2,000 salaried employees as it trims expenses and factory capacity to match declining sales. The automaker also announced the closure of one plant and layoffs at several others.

In announcing the cuts, DaimlerChrysler Chairman Dieter Zetsche said all options are on the table for Chrysler. He would not rule out a possible sale.

As part of the restructuring, Chrysler on Friday delivered early retirement offers to eligible nonunion white collar workers as it tries to cut its salaried work force by 2,000 by 2008.

The first offer went to workers 62 and older who will have 10 or more years of service as of May 31. It includes three months’ salary and a $20,000 voucher for a car or a $20,000 contribution to a retirement health care account. The workers also will get credits in a health care retirement account that ordinarily would not be given unless they were at least 60 years old and had 30 years with the company.

The second offer was made to selected employees ages 53 to 61 with 10 or more years of service as of June 30. It essentially gives them their full pension benefits and the same retiree health care benefits as a worker with 30 years of service.

Chrysler would not say how many workers received the offers. The company has 16,800 nonunion salaried workers and a total salaried work force of about 21,500.

Offers to unionized white-collar workers and to blue-collar workers will go out next week, the company said.

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Associated Press Writer Sven Gustafson in Detroit contributed to this report.

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On the Net:

DaimlerChrysler AG: http://www.daimlerchrysler.com

Chrysler Group: http://www.chrysler.com

AP-ES-02-23-07 1600EST